Not many companies can say that they’ve never lost a customer, but Distribution Solutions International can. Maintaining 100% client retention may seem impossible to some, but for David Mathia, CEO and chairman of the Traverse City, Mich.-based company, it all boils down to unbeatable customer service. A positive and empowered staff combined with some homemade technology for a unique market has helped this company grow every year since 1997.

Mainly servicing the pharmaceutical and airline industries, DSI provides a single-source solution for companies’ logistical and vendor/supplier needs. It covers everything from inventory management to shipment tracking to delivering products where and when clients specify. DSI also offers billing and reverse logistics services. It sounds complicated—and it is—but Mathia started the company with a simple idea of how customer service is supposed to be. Fifteen years later, that idea has bloomed into a company that grossed $80 million in 2004.

“The majority of our growth has been since 2000. I started the company in 1990 with no capital, no deep pockets. I just had an idea of what customer service could be like in the transportation industry because personalization did not exist,” Mathia said. “You can define customer service in a number of ways, but I define it at the corporate level as how connected a company is to us. We make sure we are giving highly personalized service, not just great service in general.”

Homemade technology
DSI’s patented, homegrown operating system, Logitrack, allows for better customer service for several reasons. First, the company’s clients can track their shipments. Second, employees can better manage distribution life cycles. Third, and most importantly, vendors are able to constantly update the status of deliveries and provide the company with forecasts. Logitrack also takes care of vendor billing, which is a huge benefit to DSI’s associated vendors and clients.

“One of the biggest nightmares in a third party logistics environment is how to pay for services from hundreds of vendors involved in the supply chain. Our system is completely automated so we can process and track shipments, and the vendor doesn’t have to spend time in the back office doing paperwork,” Mathia said.

The software programs available in 1990, Mathia explained, couldn’t cover all of DSI’s needs. “One would do line haul, one inventory management, and another delivery tracking,” he said. Each software package could be purchased separately, but the cost and hassle of integrating several systems prompted the company to write its own. Over the years, Logitrack has become the most sophisticated operating system in the industry.

Moving into 2005, DSI plans to revamp the Logitrack system by implementing version five. “We are incrementally adding new modules to our system while we start to leave our legacy system. We are taking baby steps now but hope to run and then sprint to the finish line,” Mathia said.

No robots, please
Having the right skills isn’t enough to land a job with DSI. Mathia makes sure that all potential employees have a positive attitude at the very beginning of the screening process. “I interview every person before they go to the managers. I let the managers decide if the talent and skills are there, but I am more concerned about the person’s personality and attitude,” he said. “I am looking for people who think the glass is half full.” Mathia also looks for people who are competitive with themselves because it fosters an environment of constant improvement.

Although all employees must strive to meet company and personal objectives, Mathia believes that letting each employee embrace his own work style is more productive than imposing stringent rules. “I don’t want to be a guide for how they execute their responsibilities at the individual level. I don’t want DSI robots,” he said. He gave an example of a group of people in the pharmaceutical sector who essentially have the same position but execute it in unique ways. “It is interesting to watch them knock down the objectives with distinctly different ways of getting it done.”

Shannon Core, president and COO of the company, cites empowerment as the most motivational factor for staff. “The mind set for each individual is to run their area of responsibility as if it were their own business. Each person takes ownership of their responsibilities,” she said. “Everyone has that competition with self.”

Niche player
In addition to providing logistical services to pharmaceutical companies (or providers and distributors of pharmaceutical products), DSI has penetrated the airline industry to provide a unique service. DSI manages the luggage recovery systems for the majority of airlines in the US and four foreign airlines. Once the airline recovers the luggage in the local airport, DSI delivers it back to the passengers wherever and whenever it is convenient for them.

“It takes a huge burden off the airlines, especially administratively. In the past, airlines had hundreds, and sometimes thousands, of vendors in the airports coming to deliver bags,” Mathia said. DSI has organized and simplified the process to get passengers reunited with their luggage as quickly as possible.

Not only is this service a luxury, it is unique to the industry. DSI has no competition in the airline industry with 100% marketshare. “When we started, there were no outside companies supplying that service. We went out and provided a model of efficiency and cost savings they could use that wasn’t available before,” Mathia said

When it comes to both pharmaceuticals and airlines, DSI has one objective: do what is best for all parties. Since it is a niche player in these industries, it has expertise in implementing similar processes within different companies. “We combine best practices from different organizations. We have conferences where we bring our clients, vendors, and employees from across the US to discuss best practices and how they can be used across these companies’ different platforms,” Mathia said.